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Judgment
This assessee’s appeal for Assessment Year 2017-18 arises against the Addl./JCIT( A)-1, Ahemadabad’s DIN & order No.IT BA/APL/S/250/2025-26/1078966067(1) dated 28.07.2025, in proceed ings u/s 143(3) of the Income Tax Act, 1961 (in shor t “the Act”).
Heard both the p arties at length. Case file perused.
The assessee/appellant herein raises his sole substantive grievance directed against both the learned lowe r authorities’ action treating his cash deposits of Rs.18,45,500/ - as deemed dividend u/s 2(22)(e) of the Act; in assessment order dated 30.12.2019 as upheld in the lower appellate discussion.
Faced with this situation, learned counsel has placed on record the assessee’s company M/s Skyline Constructio ns’ financials indicating to tal accumulated losses as on 13.11 .2016 amounting to Rs.2,96,342/-; and , therefore, this tribunal is of the considered view that given the fact that the above entity was not having accumulated profits, the impug ned deeming fiction of d ividends could not have been invoked by both the learned lower authorities. The impugned deemed dividend additio n is deleted in very terms therefore.
This assessee’s appeal is allowed.